FINANCE

Topshop’s Philip Green in talks to sell 25% stake

BY Katherine Boccaccio

Los Angeles — Multiple reports on Tuesday said that British billionaire and Topshop owner Sir Philip Green is negotiating with Leonard Green & Partners to sell a 25% stake in the TopShop and Topman chains.

The two brands, which would be broken off from Philip Green’s other Arcadia Group retail holdings, are valued at $1.61 billion. An announcement is expected as early as Thursday.

Neither Philip Green nor Leonard Green has commented directly on the impending transaction.

Leonard Green, together with TPG Capital, bought J. Crew in 2010 in a deal valued at about $3 billion.

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OPERATIONS

Survey: Defecting consumers could have been retained

BY Katherine Boccaccio

New York — Although consumers are defecting in growing numbers, the majority say they could have been retained, according to survey results released Wednesday by Accenture.

According to the Accenture Global Consumer Survey, in 2012 one-in-five consumers switched companies they buy from — including retailers, wireless phone and Internet service — marking a 5% increase in switching over 2011 levels. However, the survey also found that 85% of consumers say the companies could have done something differently to prevent them from switching.

Among those consumers who would have stayed if their provider had acted differently, two-thirds (67%) pointed to having their customer service issue resolved during their first contact as a factor. More than half (54%) might have remained loyal if they had been rewarded for doing more business with their provider.

Among retailers specifically, the rise in switching was 22% in 2012, up from 16% in 2011.

Broken promises are a top area of frustration for consumers, according to the survey: 63% of respondents indicate it’s extremely frustrating when a company delivers a different customer service experience from what it promised upfront.

Other frustrations that make consumers more likely to switch include:

  • Having to contact customer service multiple times for the same reason (65%);
  • Dealing with unfriendly customer service agents (65%); and
  • Being on hold for a long time when contacting customer service (61%).

“The sobering reality is that ‘tried and true’ strategies for customer acquisition, loyalty and retention are struggling to keep pace with consumers who are perpetually in motion, more technologically savvy than ever, and increasingly unpredictable,” said Robert Wollan, global managing director — Accenture Sales & Customer Services. “The news this year is that customers want to be loyal but customer service often fails to meet their expectations.”

Other survey key findings include:

  • 48% of respondents say that they have higher expectations of getting specialized treatment for being a “good” customer;
  • 31% prefer companies that use information about them to make their experience more efficient; and
  • When evaluating a company, 31% of respondents say they trust comments posted by people they know, echoing the importance of word of mouth. More than a quarter (28%) say positive comments in social media affect purchasing decisions and 28% say negative comments do so.
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FINANCE

Francesca’s profit surges in Q3 with 76 added stores

BY Katherine Boccaccio

Houston — Francesca’s Holdings Corp. reported Wednesday net income of $11 million, compared with $6.1 million in the year-ago period. Sales surged 44% to $72 million, driven by a 16.7% increase in same-store sales as well as 76 new boutique openings since the end of the third quarter last year.

"We delivered another quarter of strong results, demonstrating the appeal of our business model of a differentiated merchandise strategy in a boutique environment,” said John De Meritt, CEO. “Our scalable, high-margin merchandising model combined with productive new boutique economics provides a runway for boutique growth and gives us confidence in Francesca’s long-term growth potential."

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